Sharing Your Practice with an Associate

THERE ARE MULTIPLE REASONS why the owner of a chiropractic clinic might decide to hire an associate. Finding someone to help manage an overwhelming workload or planning for a forthcoming retirement are two common reasons, followed by the mentoring of a new graduate.

Before hiring, doctors of chiropractic (DCs) should first think about the specific reason they want to bring a new doctor onboard. Then they should ask themselves:

● What qualities are important in an associate?
● Should they have the same philosophy as you?
● Should they have a different skill set that might attract a new category of patients?
● What experience should they have?
● Would you hire a new graduate?
● How many hours do you expect them to work?
● How many years do you hope they stick around?

Ray Tuck, DC, ACA board member and the owner of 11 clinics throughout Virginia, believes that successful candidates must display excellent clinical skills and a willingness to prioritize a patient’s needs despite the demands placed on clinicians today. “We [the hiring team] look at professional demeanor, understanding of clinical practice and a real passion for serving others,” says Dr. Tuck. “We teach basic skills, but we cannot instill values or passion.”

It’s also important that they intend to work with you for awhile, suggests Michael Sackett, DC, associate professor and dean of Los Angeles College of Chiropractic at the Southern California University of Health Sciences.

Training New Staff

After hiring someone who fulfills your and/or your practice’s needs, it’s important that he or she spend ample time in training to thoroughly learn the ins and outs of your practice. This includes covering office procedures, billing and documentation methods. A Chiropractic Economics survey found that 47.9 percent of graduates begin their career as an associate.1 If you decide to hire a new graduate, you may wish to factor in a longer period of time for training since it will be the individual’s first professional experience out of college.

“In our group, training is a minimum of 12 weeks and can be up to nine months, depending on the skills the doctor joins us with and the opportunities available at the time,” says Dr. Tuck. “Our biggest goal is to set our doctors up for success.” He notes that new graduates often need a longer introduction to face-to-face patient dialogue.

A new practitioner should also spend time with clinic support staff and the billing team to ensure they are well-rounded doctors, according to Dr. Tuck. That said, Dr. Tuck notices that new graduates come out of school extremely proficient in documentation, in clinical skills and in working with other health care professionals. “Therefore, the majority of our training centers on hands-on patient experiences,” he says. “Every interaction a patient has with our company can have an overall impact on our patients’ care.”

Contracts and Benefits

DCs are encouraged to talk to an attorney about associate contracts. “A good contract memorializes an agreement,” says Dr. Tuck. “It should be fair and easy to understand. Attorneys can be very helpful on what state and local laws dictate and what is appropriate in an employee agreement in terms of details, such as non-compete clauses.”

When hiring an employee, you are required to pay taxes for social security, worker’s compensation and health benefits, among others. But if hiring an individual as an independent contractor, the employer is not required to pay such taxes.

In some sticky situations, a hiring doctor may try to hire an associate as an independent contractor to avoid paying employee taxes. Ultimately, “the IRS decides who an independent contractor is,” says Dr. Sackett. “If a DC wants a say in the hours of the individual, then the individual is an employee [associate]. Always consult with an attorney to avoid a bad tax situation.”

What the hiring DC may choose to pay for in both scenarios is malpractice insurance. “Decide if you will pay for the premium for the employee or if they should pay for themselves,” says Dr. Sackett. Be sure to factor in malpractice insurance when setting salaries – a higher paycheck might be fairer if employees are required to pay their own malpractice insurance premium. According to Chiropractic Economics’ 18th Annual Salary & Expense Survey, yearly malpractice insurance for a group practice costs about $3,200.2

Proper Compensation

A DC can decide whether to pay the associate a base salary or a salary plus a percentage of collections, among other compensation arrangements. In regard to a percentage of collections, according to NCMIC, “There is a rule of thumb that is quite fair: 30 percent. If the associate is paid, no matter what the formula, 30 percent of the collections of the billings he has generated, that is considered fair. As a matter of interest, in medicine, it is 40 percent.”3

If the proprietor of a practice is busy and needs help in maintaining the current patient base, then he or she may offer the associate a base salary only. If the DC is hoping to expand the practice, then a base salary plus a percentage of collections will be more attractive to the employee. “It will be an incentive to work harder and get new patients,” notes Dr. Sackett.

Dr. Tuck found another way to motivate his associates. “We pay our associate doctors a salary plus performance bonuses,” he says. “We believe in win-win situations. If we don’t set up a compensation plan that is fair for our doctors, we lose them. If the associate doctor is not performing in such a way that he or she enhances the company, the company loses. This is fixed by creating a budget to predict profits based on specific revenue and then deriving the performance bonuses from there.”

If the professional relationship between you and the associate is not working, it may lead to termination. “Sometimes people just don’t click professionally,” admits Dr. Sackett. Read more about firing an employee and the legal ramifications in the July 2007 issue of ACA News at www.acatoday.org/content_css.cfm?CID=2407.

Another scenario may be that the associate isn’t performing to your expectations. “When we hire an associate doctor, we do the best we can to lay out specific expectations for our doctors, including the level of production they do,” says Dr. Tuck.

“We are in a new era of health care: one that demands high performance, great patient outcomes, high patient satisfaction and working well with others for the benefit of the patient,” he says. “Therefore, these expectations can’t be all about money. That should definitely be a part of the equation; however, we gauge all aspects when we look toward setting goals.”

“What is cool is if you have a high performer who gets great results and their patients are very satisfied with their care experience, then production performance follows,” Dr. Tuck concludes.

FOR FURTHER INFORMATION regarding associates and employee contracts, check out ACA News articles, including “Just Starting Out” in Dec. 2010 ACA News and “Searching for an Ideal Fit” in May 2011 ACA News. Visit the ACA News archives at http://acatoday.org/News-Publications/ACA-News-Archive.